The Contract Logistics Market size is projected to reach US$ 475.28 billion by 2031 from US$ 294.42 billion in 2023. The market is expected to register a CAGR of 6.2% in 2023–2031. The growing e-commerce industry at a rapid pace with a surge in the online shopping trend is fuelling the contract logistics market growth. Contract logistics companies play a vital role in offering diversified arrays of delivery options. Online shopping in North American countries such as the US and Canada has increased in popularity in recent years. The total e-commerce industry sales in the US reached US$ 1.03 trillion in 2022, increased from US$ 518.5 billion compared to 2018. Many logistics companies, such as USPS, UPS, XPO Logistics, FedEx, and Amazon, are offering contract logistics and parcel delivery services. Also, the market players are making partnerships to enhance business growth to acquire significant market share. For instance, in June 2021, FedEx Corp. partnered with Nuro to test and implement Nuro's next-generation autonomous delivery vehicles.
Contract Logistics Market Analysis
Contract logistics is a third-party logistics service where the companies outsource different aspects of the supply chain operations. The contract logistics provider manages all aspects of the company’s supply chain, such as storage, distribution, transportation, and other activities.
The objective of contract logistics services is to optimize the supply chain operations, reduce overall costs, and improve efficiency. Contract logistics providers are adopting advanced technologies such as AI, IoT, and robotics to manage and outsource their logistics operations. The warehousing segment in contract logistics has the largest share in 2023, owing to increasing demand from e-commerce companies to store parcels and other goods.
Contract Logistics Market Overview
Increasing government initiatives for economic diversification with rapid infrastructure development, increasing digitization, and rapid industrialization are the major driving factors for the market growth. The e-commerce sector is producing significant demand for the global contract logistics market. Also, increasing foreign direct investments across developing countries such as India, Mexico, and Brazil are major to contribute for the contract logistics market growth.
Additionally, the rapid expansion of the manufacturing sector and increasing focus on core competencies, the growth in demand for achieving cost efficiency, job optimization, and technology adoption in the supply chain drives the market growth.
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Contract Logistics Market: Strategic Insights
Market Size Value in US$ 203,938.8 Million in 2017 Market Size Value by US$ 298,822.0 Million by 2025 Growth rate CAGR of 5.0% from 2018-2025 Forecast Period 2018-2025 Base Year 2018
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Contract Logistics Market: Strategic Insights
| Market Size Value in | US$ 203,938.8 Million in 2017 |
| Market Size Value by | US$ 298,822.0 Million by 2025 |
| Growth rate | CAGR of 5.0% from 2018-2025 |
| Forecast Period | 2018-2025 |
| Base Year | 2018 |
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Contract Logistics Market Drivers and Opportunities
Rising E-Commerce Sector Growth Owing to the Surge in Online Shopping Trends is Expected to be the Prime Driver for Market Growth
Contract logistics covers a much broader scope than warehousing and distribution. The growing number of online shoppers with the surge in Internet users in North American countries such as the US, Canada, and Mexico are the major factors driving the growth of the contract logistics market growth during the forecast period. Increasing the e-commerce industry at a rapid pace with a significant boost in online shopping trends is a major driving factor for the market growth during the forecast period. Revenues from retail e-commerce sales in the US in 2022 increased to US$ 1.03 trillion. Contract logistics is the third-party logistics that is able to handle several activities such as designing, distribution, planning, warehousing, transportation, and distributing goods. The contract logistics sector helps to simplify logistics operations.
The rising Integration of AI and Robotics in Logistics and Warehousing Sectors is Expected to Drive Market Growth.
The integration of advanced telematics and IoT solutions to improve logistics capabilities drives market growth. Contract logistics companies are developing the supply chain capabilities for enhancing the warehousing, transportation and distribution capabilities. For instance, in February 2024, GXO Logistics, Inc. contract logistics provider, partnered with a US-based Dexterity robotics company to implement AI and robotics capabilities in a warehouse operation for beauty brands. The rising integration of automation into warehousing and supply chain helps to grow and meet the company’s strategic objectives.
Contract Logistics Market Report Segmentation Analysis
Key segments that contributed to the derivation of the contract logistics market analysis are type, services, and end-user.
- Based on type, the market is divided into outsourcing and insourcing.
- Based on services, the global contract logistics market is divided into transportation, warehousing, packaging processes and solutions, distribution, production logistics, and aftermarket logistics.
- Depending upon the end-users, the global market is divided into aerospace, automotive, consumer, high-tech, industrial, pharmaceutical & healthcare, e-commerce and retail, and others.
Contract Logistics Market Share Analysis by Geography
The geographic scope of the contract logistics market report is mainly divided into five regions: North America, Europe, Asia Pacific, Middle East & Africa, and South America.
North American contract logistics market has the largest share in 2023. This is primarily owing to rapid growth in online shopping trends with surge in the e-commerce sector. The US and Canada play a significant share in the overall market. Further, the major countries include Germany, the UK, France, Italy, India, Spain, South Korea, China, Australia, Japan, and Brazil.
The Asia Pacific region has the highest CAGR during the forecast period owing to the increasing middle-class population across China and India. Increasing urbanization with the surge in smartphone penetration has created a massive demand for the Asia Pacific contract logistics market growth during the forecast period.
Contract Logistics Market Report Scope
Contract Logistics Market News and Recent Developments
The Contract Logistics Market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. The following is a list of developments in the market for Contract Logistics market and strategies:
- In August 2023, CEVA Logistics acquired 96% of Stellar Mumbai India-based Value Chain Solutions. CEVA Logistics expanded contract logistics nationwide to improve cold chain logistics capabilities. (Source: DJI, Press Release/Company Website/Newsletter)
- In March 2024, Rhenus launched integrated logistics services to improve its supply chain capabilities in India. Rhenus India introduced this new product across all business units, added new business units, and enhanced its capabilities in the logistics sector. (Source: Flyability, Press Release/Company Website/Newsletter)
Contract Logistics Market Report Coverage and Deliverables
The “Contract Logistics Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:
- Market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
- Market dynamics such as drivers, restraints, and key opportunities
- Key future trends
- Detailed Porter’s Five Forces analysis
- Global and regional market analysis covering key market trends, major players, regulations, and recent market developments
- Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments
- Detailed company profiles with SWOT analysis
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Type ; Services ; and End-user
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
US, Canada, Mexico, UK, Germany, Spain, Italy, France, India, China, Japan, South Korea, Australia, UAE, Saudi Arabia, South Africa, Brazil, Argentina
The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.
- Data Collection and Secondary Research:
As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.
Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.
- Primary Research:
The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.
A typical research interview fulfils the following functions:
- Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
- Validates and strengthens in-house secondary research findings
- Develops the analysis team’s expertise and market understanding
Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:
- Industry participants: VPs, business development managers, market intelligence managers and national sales managers
- Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.
Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.
- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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